FOR SEVERAL YEARS, regulators and prominent politicians have been trying to run the companies that sell electricity to individual Massachusetts residents out of business. They have accused them of lying to and cheating their customers, and tricking them into paying exorbitant rates for electricity.
On Wednesday, they added a new charge – greenwashing.
At a briefing sponsored by the backers of a bill that would shut down competitive retail electricity suppliers, Larry Chretien of the Green Energy Consumers Alliance said many of the companies back up their claims of providing 100 percent clean energy by pointing to renewable energy certificates, or RECs, purchased in places like Texas and Iowa, not Massachusetts.
“Suppliers in Massachusetts are working with generators in those states to essentially rip people off,” Chretien said. “What competitive electricity suppliers have been doing is making the implicit claim that a REC purchased from Texas or Iowa is equivalent to a REC purchased from a New England project, and it’s just not the same. The projects in Texas and Iowa are fine. We all benefit in some way in terms of greenhouse gas emissions that they went online, but the purchase of the REC does nothing. That project is existing for other economic reasons and to go to a consumer in Massachusetts and tell them that that REC is going to help them clean the electricity grid up here or even in Texas and Iowa – the purchase is totally useless.”
RECs are a way of subsidizing clean renewable energy. For every megawatt of clean energy a project produces, it receives a REC. Since electrons produced with fossil fuels are no different from electrons produced without fossil fuels, companies marketing electricity made without fossil fuels buy RECs to assure their customers that their purchases are supporting the production of clean, renewable electricity.
In Massachusetts, 59 percent of a customer’s electricity has to come from renewable energy produced in Massachusetts. Customers can voluntarily go beyond that level – all the way up to 100 percent – but their supplier has to have the RECs to prove it.
Chretien said most of the retail electricity suppliers he and Gov. Maura Healey, Attorney General Andrea Campbell, and Boston Mayor Michelle Wu want to put out of business are using RECs from Texas and Iowa to verify their clean energy claims for energy beyond the 59 percent. Those RECs cost about $4 each, Chretien said, compared to $40 each for RECs produced in Massachusetts – and contribute very little to the development of renewable energy in those states.
Abby Foster sees nothing wrong with buying RECs from Iowa and Texas energy developers. Foster is vice president of policy and advocacy at the Retail Energy Advancement League, a group set up by retail electricity suppliers to fend off attempts around the country to shut the industry down.
Foster said there are not enough RECs being generated in Massachusetts to meet demand, so the cost of them is high. She said there is nothing improper about using RECs from other states to help justify clean energy claims in Massachusetts.
“Whether it’s in Massachusetts or Iowa, it’s still helping the environment,” she said.
The fight over RECs is just the latest skirmish in a years-old battle over whether retail electricity suppliers should be allowed to operate in Massachusetts. Healey launched the fight as attorney general in 2018, issuing the first of several reports suggesting most customers of retail energy suppliers were paying far more than they would if they just remained on the so-called basic service provided by their local utility.
Campbell has picked up where Healey left off and been joined by Wu, who as a city councilor pushed for the creation of an agency to purchase electricity on behalf of residents. So-called municipal aggregation has caught on, but the state Department of Public Utilities has been slow to approve applications from many communities.
Retail electricity suppliers have mounted a campaign to stay open, produced studies highlighting the savings they offer, and supported legislation to clean up the industry. A stalemate of sorts has emerged on Beacon Hill, but Wednesday’s press conference was the start of an intense lobbying effort to win passage this year. With Healey in the corner office, supporters of doing away with the retail electricity supply industry say they have an opening.
Rev. Mariama White-Hammond, Boston’s chief of environment, energy, and open space, said electricity pricing is just too complicated to leave to individual customers, particularly if they are non-English speakers who are vulnerable to the pitches of unscrupulous door-to-door sales people.
“Are people able to evaluate one pharmaceutical product over another without the help of a doctor?” she asked. “If you don’t have advanced knowledge of the electricity market, you’re just not equipped to negotiate the differences between the two pieces. Fifteen years ago I might have thought differently, but we have plenty of data to show that far more people are being hurt by it than being helped.”
Sen. Brendan Crighton of Lynn, a cosponsor of legislation to do away with retail electricity suppliers, said he sees no way to reform the industry. “I don’t think reform would yield the results we’re looking for,” he said.
Chretien said the goal should be to get people into aggregation programs in their local communities. “I don’t think that a reputable company can make a go of it in the individual residential electricity market. It’s not possible without greenwashing or without ripping people off,” he said. “It really comes down to municipal aggregation is far superior. Let’s get suppliers focused on that. If they don’t want to bid into that, good riddance.”